Overland Park should be able to keep its mill levy at 13.565 for the 2019 budget, said City Manager Bill Ebel as he presented his recommendations for the upcoming year’s budget. The 5.7 percent rise in Overland Park’s home values was not so high that it exceeds the Kansas Legislature’s tax lid and would trigger a reduction in property tax rates, he said.
But he did recommend a $3 increase in the stormwater utility fee to accelerate a curb replacement program the city initiated in 2017. The increase would bring the fee to $33 per household.
• Mill levy would hold steady at 13.565 — lowest among Kansas Cities of the First Class
• Stormwater utility fee would rise $3 to $33 per household.
• City looking to hire 19 employees across departments
• Operating expenses expected to increase 4.2 percent overall
He also proposed adding 19 full time equivalent employees to various city departments.
The flat mill levy is the result of a relatively stable financial situation, Ebel said. The total budget proposed is $294.6 million, which is an increase of just less than one percent over the current year. The general fund, which covers the city’s operating expenses, would be $122.5 million, an increase of 4.2 percent over this year.
Since the projected revenue of $49.4 million generated in the 2019 budget falls short of the state’s $50.3 million cap, councilmember Paul Lyons said it might be time to consider reducing the tax rate by another quarter mill.
“I think we should at least consider the possibility of reducing the mill levy another quarter mill in response to the fact that a lot of people were hit hard by the big increase in assessed valuations,” Lyons said.
However councilmember David White said the city should proceed carefully with any plans to reduce property taxes. If the city misses out on too much sales tax from online sales and property tax is too low, “we may have some problems,” he said.
Councilmember Richard Collins pointed out that reducing the tax might mean reducing efforts to improve curbs and streets in neighborhoods that need it.
While residents in other cities got a shock when they learned of their latest property valuation, Overland Park’s 5.7 percent was within range of the 5 percent increase the city had projected. That extra bump adds about $400,000 to the projected revenue which can be spent on curb repair and two construction specialists for the curb program, Ebel said.
The city started the program to repair and replacing aging curbs last year and it has been well received so far, Ebel wrote in his report. But the amount of curb replaced has fallen short of the five miles the city hoped to do when the program was begun.
Only four miles was replaced last year and four miles is anticipated for this year as well. That’s because bids have been higher, or because the curb work sometimes requires other repairs like wheelchair-accessible ramps, Ebel said. Increasing the fee would allow the city to get back on track with 5 to 5.5 miles of curb repair in the future, he said.
Overland Park needs to add 19 employees because hiring has been cautious in the past few years after the recession, he said. The new employees can be justified by the city’s growing population, he added. Ebel told the council members that even with the additional staff the city will still be below pre-recession levels. In 2009, for example, the city had 1,092 employees. The 2019 budget proposes 1,084.
The employees would be added throughout the city government. Besides the construction specialists for the curb program, the proposed hiring includes three analysts for information technology, three police officers plus a dispatcher and investigation specialist in the police department, a fire inspector and data analyst for the fire department, a digital communications assistant, two animal care workers at Deanna Rose Children’s Farmstead, a probation officer for municipal court and part-time lifeguards at Matt Ross Community Center.
Predicting sales tax revenue for the next few years has been tricky because of the disruption the internet has caused in traditional stores. Sales and use tax revenue for the first quarter of this year was slightly higher than anticipated, Ebel said. Nevertheless, the city manager made a conservative 1.8 percent growth projection for those taxes in figuring the 2019 budget.
There will be some challenges in coming years, Ebel said. Big box retailers who challenge their property values, low unemployment that raises the cost of labor and makes it harder to find new hires and rising construction costs were all mentioned as was the tax lid.
Other spending proposed in Ebel’s budget included: $31,000 for live streaming of city meetings, $51,500 to for removal of 100 ash trees in the emerald ash borer program and $40,000 for the Fourth of July Star Spangled Spectacular. That event at Corporate Woods had been run by the Overland Park Rotary Club as a fund raiser for 19 years. But when the club announced it could no longer continue the event due to a lack of volunteers, the city agreed to step in. The council said at the time that private sponsors would be approached to recoup part of the cost.
The proposed budget will next go through committees for further tweaking before the public hearing Aug. 6. Final action is set for the Aug. 20 council meeting.